Nuclear Advocates Urge Biden, Congress To Reverse Trump Policy, Open China To U.S. Nuclear

A growing chorus of nuclear energy stakeholders is asking the Biden administration and Congress to reverse course and open up the Chinese market to U.S. nuclear energy companies in the name of safety and climate change.

President Biden is continuing former President Trump’s 2018 nuclear energy policy restricting U.S. nuclear energy companies from exporting to, or developing nuclear energy technology with, China.

Some say restricting American nuclear energy companies from the Chinese market threatens global nuclear energy safety, undermines global climate change efforts to reduce emissions worldwide, and reflects an incongruent trade policy.

BEIJING, CHINA – DECEMBER 04: Chinese President Xi Jinping (R) shake hands with then-U.S Vice … [+] President Joe Biden (L) inside the Great Hall of the People on December 4, 2013 in Beijing, China. (Photo by Lintao Zhang/Getty Images)

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Meanwhile Congress is preparing to codify that Trump policy.

In a memo obtained by Forbes, the Nuclear Energy Institute (NEI) told stakeholders, “Growing anti-China sentiment in Congress has put U.S.-China nuclear cooperation in increasing jeopardy. Cutting off cooperation is of great concern to the entire U.S. nuclear industry because of the potential harm to global nuclear safety cooperation and the U.S. supply base.”

NEI predominately represents U.S. nuclear power plant owners and operators but its membership also includes reactor developers and other companies across the supply chain, universities, research labs, law firms, labor unions and international electric utilities.

At issue: a pair of Senate and House bills—S. 1260, the Endless Frontiers Act, and H.R. 3524, Ensuring American Global Leadership and Engagement Act—both of which effectively end bilateral cooperation with China on civil nuclear projects.

The House Foreign Affairs Committee could advance H.R. 3524 as early as this month, which could include more restrictive measures in the form of amendments.

At stake: a global nuclear construction marketplace expected to be $5 trillion by 2050.

A Safety Risk

In a June 30 letter to the House Foreign Affairs Committee, American Nuclear Society CEO Craig Piercy said the bill would harm “U.S. national security and economic interests, and American workers.”

ANS represents more than 10,000 professionals in nuclear science and technology.

Piercy said locking U.S. companies out of the Chinese market threatens operational safety of nuclear power plants in China and those built by China around the world. And it reduces U.S. influence.

“We want to make sure that we have the ability to influence international safety norms and understand what is happening in global markets,” Piercy told Forbes.

The global Nuclear Nonproliferation Treaty already allows the U.S. nuclear energy industry to work freely to share its technology. Though China’s unique policy allows it to share nuclear technology between its civil and military sector, there is a way to protect U.S. commercial interests, Piercy said.

“Can we conduct commerce without giving away the U.S. crown jewels in this area?” Piercy said. “The answer is yes. We do not have to pick up our ball and go home because we’re afraid that we’re going to get taken.”

Intellectual property protection, keeping U.S. technology from being copied unfairly, are all possible while working in and with China, he said.

According to a recent Forbes article on nuclear energy, 96 nuclear reactors have been connected to the grid in 13 countries over the past 20 years. Of these, 45 were constructed in China.

The U.S. has an opportunity “to steer the way the global renaissance unfolds,” Piercy said. “It’s going to happen, whether the U.S. participates in it or not.”

According to the U.S.-China Business Council, a nonprofit nonpartisan group that represents 200 companies that do business with China, sales of nuclear energy technology have totaled about $170 million before 2018, a number they said was “not significant,” when then-President Trump restricted newer U.S. nuclear technology from export. Technology export is now limited to replacement parts for older reactors. But China needs smaller reactors that can float or power ships, the group said.

For new technology export, American companies could request a waiver from the U.S. Commerce Department, but there is a presumption of denial, so no U.S. nuclear energy companies, including Bill Gates’ TerraPower, were allowed into the Chinese market.

TerraPower, which had announced in 2017 it would build a test reactor south of Beijing with China National Nuclear Corp. (CNNC), had to pivot once Trump announced his policy.

Sources close to the deal say Gates was furious and petitioned DOE. There was some consolation for the company.

Forbes reported in December that the U.S. Department of Energy awarded TerraPower $80 million to build advanced reactors that could be used in the U.S. and overseas.

Trump’s then Assistant Secretary for Nuclear Energy, Dr. Rita Baranwal, also awarded TerraPower and GE-Hitachi $80 million to demonstrate their unique Natrium reactors, sodium-cooled fast reactors, in Wyoming in a partnership with PacifiCorp, in lieu of its deal with Beijing’s CNNC.

The funding came from DOE’s $230 million Advanced Reactor Demonstration Program which Baranwal launched last Fall.

Factoring U.S. Nuclear Out of Global Climate Calculus

US President Joe Biden speaks during climate change virtual summit from the East Room of the White … [+] House campus April 22, 2021, in Washington, DC. – President Joe Biden on Thursday sharply ramped up US ambitions on slashing greenhouse gas emissions, leading new pledges by allies at a summit he hopes brings the world closer to limiting climate change. Putting the United States back at the forefront on climate, Biden told a virtual Earth Day summit that the world’s largest economy will cut emissions blamed for climate change by 50 to 52 percent by 2030 compared with 2005 levels. (Photo by Brendan Smialowski / AFP) (Photo by BRENDAN SMIALOWSKI/AFP via Getty Images)

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Nuclear energy stakeholders say restricting American nuclear energy companies could thwart global efforts to cut carbon emissions blamed for climate change.

Within his first 100 Days as President, Biden rejoined the Paris Accord, set new climate goals for the U.S.—at least a 50% percent reduction in economy-wide greenhouse gas levels by 2030 and net-zero emissions by 2050 – and invited 40 world leaders to Washington to address the climate crisis, one the administration calls a matter of national security.

“Given that more than 85% of emissions come from beyond U.S. borders, domestic action must go hand in hand with international leadership,” according to a White House statement.

And it has to some degree.

Biden is continuing to allow the U.S. International Development Finance Corporation to grant loans for nuclear power projects abroad, another Trump administration policy to expand the use of U.S. nuclear technology in the developing world.

And that declaration that climate change is a matter of national security invites the Defense Department, the intelligence community, and others into the conversation, said Retired Rear Admiral Michael Hewitt, CEO of Allied Nuclear and its parent IP3.

“It opens up the aperture to the conversation of nuclear power through the lens of climate change and national security that was missing before,” Hewitt said.

Allied Nuclear is a U.S.-based global nuclear energy adviser, a start-up that helps foreign governments procure nuclear technology from American and commercially driven international companies, tailors financing and helps countries start nuclear energy programs.

However, “we [still] have an aggressive domestic agenda that doesn’t translate to a global agenda,” one that addresses the primary culprits of climate change, namely China, he said.

According to an article published by Yale Environment 360, Despite Pledges to Cut Emissions, China Goes on a Coal Spree, 58% of China’s total energy consumption came from coal. China accounts for 28% of all global carbon emissions.

China built more coal plants in 2020, during the pandemic, than ever before.

Though China is building its own nuclear energy reactors, outpacing all countries, it brought 38.4 gigawatts of new coal-fired power generation into operation. That’s more than three times what was brought online worldwide, according to 360.

Biden’s Energy Secretary Jennifer Granholm told NEI in June at its Nuclear Energy Assembly that nuclear energy must be used to meet U.S. climate goals. She asked the President for $1.85 billion in his Fiscal 2022 budget for nuclear energy, a 23% increase over the previous year.

While Granholm told World Nuclear News that nuclear is essential for the U.S. to reduce carbon emissions 52% by the end of 2030, she fell short of addressing how U.S. nuclear technology could help the rest of the world do so.

Harbingers of Policy in Reverse

BEIJING, CHINA – JUNE 7: US Secretary of State John Kerry (L) speaks with China’s President Xi … [+] Jinping (R) at the Great Hall of the People at the end of the eight round of U.S-China strategic and economic dialogues on June 7, 2016 in Beijing, China. Kerry has been in China for talks on a variety of issues including seeking diplomatic solutions for the South China Sea. (Photo by Nicolas Asfouri – Pool/Getty Images)

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In December 2020, months after President Biden had installed his transition team, several members of which came from Columbia University, its School of International and Public Affairs’ Center on Global Energy Policy released a report describing how the Trump administration had harmed relations with China to the detriment of the climate. The report said President Biden has a real opportunity to solve climate problems with the help of China by undoing Trump’s policies.

The report, How the U.S. and China Could Renew Cooperation on Climate Change, concluded, “To pull back from climate catastrophe, a cooperative U.S.-China relationship is critical. Despite heated campaign rhetoric and heightened geopolitical and trade tensions, there is an incredible opportunity for climate change to be the issue that helps catalyze a significant improvement in U.S.-China relations.”

Just over a month into the new administration, Biden’s Special Presidential Envoy for Climate, John Kerry, asked that “climate change be treated as ‘a compartmentalized issue’ in U.S.-China relations, but acknowledged that it may be hard to ‘disentangle’ it from other issues in the relationship,” according to a White House statement published by the Congressional Research Service.

Cary Krosinsky, a China investment expert, author and sustainable investment professor at Brown University and Yale said, “Two years ago, [Kerry] spoke to my class and made it very clear he was very upset that the U.S.-China relationship that he had built [as Secretary of State] had been allowed to degrade.”

“He was very upset about that,” Krosinsky said. Kerry thought the U.S. and China should invest together to expand renewable energy in the developing world. “My instincts tell me that one could anticipate a dialogue and more consistency in policy in the not-so-distant future,” Krosinsky said.

In his latest book, Modern China: Financial Cooperation for Solving Sustainability Challenges, Krosinsky explains how China needs capital for its ambitious Belt and Road Initiative. “If we’re looking to influence what China does on energy, it can be done through capital,” he said.

But the U.S. must be in the region. “You’ve got to be in the game to have influence. Otherwise, you’re at risk of getting left out of the conversation,” Krosinsky said.

Foreign investors own a third of U.S. public companies. “We’re already in a global economy. It’s a question of whether we recognize that,” Krosinsky said.

Not everyone is in agreement on how open China should be to U.S. companies.

There’s Always Europe

“We just made a bad bet on China, not just in the nuclear power industry, but in almost everything,” Hewitt said. “How do you deal with China, and how do you partner with China.”

In the wake of a trade war, the Trump administration was trying to fertilize the European Union market for new U.S. nuclear technology, Hewitt said.

“There were a lot of good conversations about nuclear power in Europe during the Trump administration,” Hewitt said. “What was missing was the EU and others were pushing back on nuclear power in their [Environment and Social Governance] criteria. They were really holding back the industry.”

The paradox is that the Biden administration supported Gazprom’s Nord Stream 2 at the G7 meeting in June. The celebrated pipeline is expected to transport Russian natural gas to Germany and other EU members.

“The Biden administration has supported it, which seems odd when we shut down our own pipelines in America,” Hewitt said. “When the European nations are stuck decarbonizing, their only option may be to partner with the Russians on natural gas… [but] the piece that’s really missing in this conversation is nuclear power.”

Incongruent Trade Policy

While the Chinese market to new U.S. nuclear technology is effectively closed, other sectors are free to trade.

According to a 2021 report from the U.S.-China Business Council (USCBC), U.S. goods exported to China “surged” up nearly 18% from the previous year by $18.5 billion, a third of which came from Texas which exported $6.3 billion in oil and gas products to China, a $4 billion leap from the previous year.

“This jump in fossil fuel sales also helped stimulate an export jump in neighboring Louisiana, where oil and gas exports rose by $1.7 billion,” the report said. “These sales were driven in part by significantly higher purchases by Chinese state-owned firms aiming to fulfill purchase commitments under the Phase One trade deal.” 

Agricultural and the semiconductor industries are also dominant U.S. exports to China.

U.S. goods exported in 2020 totaled $123 billion while services exported in 2019, the most recent data available, totaled $54 billion. 

Behind Canada and Mexico, China is the third largest U.S. market for exports, and more than a million U.S. jobs are supported by exports to China, the USCBC said.

When it comes to U.S. nuclear question, USCBC communications director Doug Barry said, “We need a comprehensive China trade policy with substantial input from the business community and clear-eyed accounting of the unintended consequences of overly broad sanctions, as well as the costs to American workers and families.”

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